downhill slalom, for a year
This is pretty exciting. IndyMac of Pasadena has been in failure mode since this time last year. The gradual failure prompted a letter from a Senator (Schumer, NY) a few weeks ago, which precipitated a run on the bank. The bank was seized by FDIC regulators yesterday subsequent to the run. This is the second largest bank failure in history.
John Reich, director of the Office of Thrift Supervision, a chronic Republican community banker who spent twelve years working for Republican Senator Connie Mack's chief of staff, and appointed by President Bush in 2005, blames Schumer for the run on the bank. But looking at the institution's stock price over the past year, one readily sees that investors have known the place was cascading towards Armageddon for the past year.
Under Reich, whom Bush appointed to the FDIC board in 2002 after an undistinguished career in community banking, the Office of Thrift Supervision has largely gone AWOL until this year. It's shades of "Heckuva job, Brownie!" all over again.
How do you go bankrupt? Two ways: gradually. And then suddenly.